Tag Archives: bridge loan

Commercial Bridge Loans

June 23, 2019   Home Mortgage

What are commercial bridge loans?

Many a times a company is approved for a loan through its bank, or financial institution, but the loan doesn’t close for four to six months. During this time the company can take the help of a short-term commercial bridge loans, which can be repaid when the senior loan closes. Commercial Bridge loans can help the company to meet their financial needs and remain stable.

Are you in a process of finding capital for your new business or looking for your business expansion? By now, you must have found that arranging finance for a company can be time consuming, stressful and equally frustrating. However a little bit of planning and preparation before hand will save you lots of disappointment and aggravation. Like any partnership, business which is what obtaining commercial bridge loans are, the partners want to guarantee you have researched your opinions and know what exactly you require before coming to them for commercial business loans.

There are number of ways to generate a cash flow for your business. Hence remember that not all may be right for you. Suppose you business is starting point or small you may not be eligible for a commercial bridge loan.

You can avail a commercial bridge loan for any purpose. This includes the capital for commercial property or equipment, restructuring debt or for working capital. The terms for this type of commercial bridge loan are that the loan is for 12 months or less and that there is a proposed exit strategy.

The following list can help you identify the types of information the banker will want from your end when you apply for a commercial loan.

· Three years income tax and financial statements · Year to date profit and balance sheep statement · Your Performa for the next 12 months · Length of the loan · Federal and state tax information · Personal finance statements · Your collateral sheet · Well-written business plan

Obtaining a commercial bridge loan can be a bit difficult especially when you are unaware of the correct entities that provide such funding. Today one can find numerous lenders and private investors who assist businesses with a Commercial bridge loan. You can avail funds anywhere around $1,00,000 to $10,00,000. Its all about selecting the right loan resource to meet your loan needs.

Tips that can help you help you select a right business loan lender

Commercial lenders are fussy. So just relax even if your loan gets down, simply go to the next four cheapest commercial loan lenders on the list and apply with a simple mouse click. There are lots of “A” paper lenders; “B” paper lenders and easy “C” paper lenders. Make sure that you are dealing with dedicated and pre-approved lenders with knowledge and decision making ability.

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Bridging Loans

January 27, 2019   Auto Loans

If you have ever been stuck in between the purchase of your new home and the sale of your old home, understanding bridging loans would have been helpful. Nothing is worse than paying two mortgages when it is unexpected. Thankfully, bridge loans have been created by lenders to help address this challenging situation.
Bridging loans are temporary term loans that help to bridge this gap between the closing of the present home and the closing of the new home. Despite this not being a common scenario, under a few occasions there is a longer time frame than was initially anticipated. The bridge loan helps the property owner to cover their simultaneous mortgage costs, with the proceeds from the bridge loan being also used towards the down payment on the new property once closing occurs.

The Bridge Loan Process

As with any home mortgage, the buyers must go through underwriting to become approved for a bridge loan. Every lender will often have their own approval procedure that must be followed in order for the owner to be approved for the bridge loan. And, these qualifications are often more lenient than traditional home lenders when it comes to debt to income ratios, meaning that these ratios can often be higher than with traditional lending.

The rationale of different requirements associated with the bridging loans is that they are temporary and generally created to assist a property owner in moving from their current property into their new property. And, the proceeds from the bridge loan are almost always applied to the new home loan in the event that they are not used during the transition period before to closing on the new home.

Benefits of Bridge Loans

There are a number of benefits to the property buyer of bridge loans, including:
• It allows the property owner to put their property onto the market quickly and often with less restrictions than if they didn’t have the additional financial cushion.
• A lot of bridge loans don’t require monthly loan or mortgage payments, providing some financial relief to the current property owner.
• The loan can give the property owner some flexibility with contingencies on their home sale, allowing them to turn away offers that are not favourable without financial fear of paying two mortgages in the event that their new property closes as anticipated.

Disadvantages of Bridge Loans

While there are multiple advantages to using a bridge loan when selling or buying properties, including:
• The costs associated with bridge loans are typically more than traditional home loans and even home equity loans.
• Some property owners may not qualify for a bridge loan due to the lending qualifications
• Even though the bridge loan helps the property owner in covering mortgage costs during the transition process between properties, they must still pay for both loans and the interest that is accruing on the bridge loan.

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